Our financial expert Darryl Bannon shares her top tips for making 2019 the year you really get your finances in order.
Financial wellness can mean different things to different people. If you are spending at a rate of a
tornado, there may be underlying attitudes towards money that need some reflection. If you are struggling to get a hold of your spending it can be difficult to know where to start.
Ripping up all your of your credit and debit cards and setting a strict weekly cash budget is one drastic solution. But it isn’t necessarily a long-term sustainable approach. And how do you know if you have set the right weekly budget?
Evolving your spending habits
When rethinking your budget it’s best to start from the bottom. You may have heard of Maslow’s Hierarchy of needs – if not, the theory revolves around the principles that we have basic needs that need to be achieved first. We then build up from this until we get to the point of ‘self-actualisation’ – our happiest
state.
For the purpose of this blog, I’m going to focus on the basic needs:
1. Accommodation – If you are coming to the end of your lease could you find a cheaper place by moving to a more affordable area? Weight up the cost of transport and if it works out cheaper, it might be time to consider a move. With mortgages, if you are not on a fixed rate or coming to the end of a fixed period, think about switching providers.
Do not take a higher amount! Instead, as you have paid off some of the principles, you technically could get your repayments down.
2. Utilities – It may seem like a faff but can you switch providers? Price comparison sites are extremely easy to use and it can take just 5-10 mins to switch. Also, if you want to be a bit greener AND save money think about switching off lights, turning down your thermostat a few degrees, putting on an extra jumper and investing in appliances that are more energy efficient when it is time to replace them.
3. Phone & broadband – as with utilities, shop around and look at comparison deals with providers. Don’t be afraid to ask for a better deal. Ring your current provider, they will often price match or better a competitor’s deal if you threaten to leave. Also, look for deals that bundle other
options you need. For example, Vodaphone offers Spotify and Now TV with some of their contracts. Shop around!
4. Food – Cooking from scratch can without doubt be cheaper than ready meals and takeouts but only if you plan! Not
everyone is Nigella Lawson though so build your confidence with some basic recipes and simple batch cooking. Making your own lunches could save £100’s a year and switching from branded food products can save much more. Believe it or not, supermarket own brands are often made by well-known
companies! Don’t forget to plan your meals weekly – you’ll save money, avoid food wastage and buy only what you really need.
5. Clothing – I am a great believer in looking at price per wear. Considering we only ever wear 20% of our wardrobes consistently, it takes a mindset change but why not invest in a decent jacket that could last 20 years? Also, my top tip – never let a sales assistant put clothing in the changing room for you. Walk around with clothes in your hands. By the time you are ready to try things on, you’ll be surprised the number of things you will put back. Avoid getting yourself in situations where you feel obliged to buy. Look at vintage/charity shops and take advantage of the sales – don’t underestimate